WATERBURY — Saint Mary's Health System, parent of Saint Mary's Hospital, reported a surplus of more than $7 million for its 2012 fiscal year, the fifth time in the last six years it has finished with an annual budget surplus.

The health system finished the fiscal year that ended last Sept. 30 with a surplus of $7.2 million, Chad Wable, president and chief executive officer of both the health system and the hospital, said Wednesday.

The annual surplus included a $4.5 million surplus in operating income and a $2.6 million surplus in non-operating revenue. Non-operating revenue consists of income produced by the health system's investments and securities, as well as its minor interest in the hospital's imaging center.

The health system posted a deficit of $2.3 million for fiscal 2011, and a surplus of $6.5 million in 2010.

Saint Mary's Hospital itself posted an annual surplus of $15.3 million, including an operating surplus of $12.6 million and a non-operating surplus of $2.7 million. The hospital, which reported a surplus of $6.9 million for fiscal 2011, has now reported an annual budget surplus for six straight years.

The hospital's $15.3 million surplus for fiscal 2012 is included in the $7.2 million surplus reported by the health system.

While Wable called the 2012 surplus a "positive development" that underscores the hospital's ability to maintain its "fiscal balance" in a difficult economic environment, he also noted that the $7.2 million surplus wasn't large enough to eliminate all the fiscal challenges faced by the hospital and its network.

The 2012 surplus represents an operating margin of about 2 percent, he said, while the hospital would ideally need to operate at a 3 percent to 5 percent margin to generate enough capital to maintain and improve its aging physical plant and to continue to invest in the latest, state-of-the-art technology.

"The surplus helps us maintain our fiscal balance, it keeps us on even footing," Wable said. "But it's not going to generate the kind of capital we need to address everything on our wish list."

The positive surplus will, however, enable the hospital to remain on a "deliberate and thoughtful" course as it continues its search for a long-term capital partner, he said.

"We're not in a position where we desperately need to get something done," Wable said. "We can afford to exercise a little patience."

The hospital's positive financial performance, coupled with its market position as a "low-cost, high quality (health care) provider, allows us to be very intentional and prudent in our (search) process," he said.

Wable also warned that Gov. Dannel P. Malloy's proposed state budget, which includes cuts in reimbursements to hospitals of about $550 million, would significantly affect the bottom line of every hospital in Connecticut. Saint Mary's projects it will lose nearly $20 million in state reimbursements over the next three years, based on the proposed fiscal plan.

Saint Mary's Health System reported revenue of $266.5 million in fiscal 2012, a 4 percent increase from $255.3 million in revenue in fiscal 2011. Expenses for the year increased 2 percent, to $262 million from $257.6 million.

The hospital posted revenue of $231 million in 2012, a 9 percent increase from $212.6 million in 2011. Hospital expenses for the year increased 6 percent, to $218.4 million from $205.7 million.

Admissions at Saint Mary's Hospital decreased slightly in fiscal 2012, falling to 12,464 from 13,189 the previous year. Emergency room visits fell slightly to 69,717 from 69,841, while births fell by 66 in fiscal 2012, slipping to 1,021 from 1,087 in 2011.

Surgical procedures dropped 7 percent to 16,084 from 17,237. The surgery totals includes procedures performed at the Naugatuck Valley Surgical Center.

The health system employs 1,900 people in the equivalent of 1,400 full-time positions, according to Saint Mary's spokesman Joseph Connolly.

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Bob wrote on Mar 28, 2013 8:21 AM:

" That is because they check your insurance before your health, unlike Waterbury. "

Hey "Bob", try to enter ANY hospital and not be asked how payment will be made. Waterbury Hospital is no different. The difference is that St. Mary's delivers and sponsors far more health care for the indigent and non-payers than Waterbury.

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